If you’ve been at any mall recently, you’ve probably seen big “closing” signs at some of our favorite stores such as Forever 21 and Charlotte Russe. Additionally, major department stores such as Sears and JcPenney are going bankrupt. For stores like these that are so beloved, it might be difficult to understand why these stores are going bankrupt. But if we peel back a layer, the reasons are quite obvious.
First, many stores cannot compete with the online shopping industry. Online stores like Fashion Nova are some of the most common and convenient shopping companies. Of course, Forever 21 and Charlotte Russe have online stores, but they cannot compete with the amount of shoppers Fashion Nova has. Additionally, consumers’ tastes are changing, and many companies are not keeping up with fashion trends. Many have criticized Forever 21 and Charlotte Russe for their poor quality clothes and “tacky” styles. Unsurprisingly, stores like American Eagle are still doing well because of their style selection and high quality items.
Another factor that plays into the bankruptcy of companies is the decline of malls. Dead malls, or malls that are basically vacant, are becoming more and more common. More people than ever would rather shop online than physically go to malls. In 2019, more store closures — nearly 6,000 – have been announced than in all of 2018. Experts have called this phenomenon “retail apocalypse.” It is truly out of anyone’s control because naturally, shopping patterns will change throughout the years. However, it is the company’s responsibility to try to keep up with these changing patterns and make their business appealing to the masses.